Akava affiliates also oversee issues of concern for freelancers

Tuire
Torvela, Legal Adviser for Akava Special
Branches,also provides advice for
freelance members. She has particularly received requests for advice
from freelancers
working on the basis of a freelance tax card or business name.
Freelancers working on a tax card can be employed within a traditional
employment relationship or a so-called nonwage work compensation
relationship
with a commissioning party.

– It is often difficult to draw the line as to what is
considered an employment relationship and what is not. This
ambivalence drums up a lot of questions, says Torvela.

If the work is carried out within an employment
relationship, the employer is obliged to pay the employee’s pension
security. If the work is not done within an employment relationship, and
the
freelancer has no company of his/her own, then the one who has
commissioned the
work can pay the freelancer a nonwage compensation. The
commissioning party shall withhold the taxes on the nonwage
compensation, but
is not obliged to pay social security and pension contributions for the
compensation. Anyone receiving nonwage compensations must take out a YEL
insurance
policy, if the total compensations exceed 7,303.99 euro per year.

– Additionally, those working on the basis of a
freelance tax card seek advice on issues related to the determination of their
wages; in other words, those issues that should be considered
when determining the amount of wages, Torvela says.

For example, a freelancer who invoices a total of
3,000 euro per month, may only receive gross earnings of 1,500 euro, if
the wage-related
fees and operational expenses eat up half of what's earned. The share
varies according to the total amount of work-related expenses
accrued to the freelancer. In addition to the pension contributions for
entrepreneurs, such expenses include, e.g., rent for an office, and
work-related
equipment and materials required for work.

– Advice is also requested concerning the content of
commission agreements.

The guide for freelancers (Free-sopimuksen ABC opas,
in Finnish), jointly drawn up by the Federation of the Finnish Media Industry
and the Union of Journalists in Finland, states that freelance agreements
generally state, at least, the timetables and wages, and often on other issues,
such as different copyright issues. Torvela has been
contacted by freelancers working under their own business name, particularly on
issues concerning the content of agreements and their interpretation. The law
does not require that commission agreements be made in writing, so verbal
agreements are also considered to be valid. However,
in order to facilitate the resolution of possible disagreements, it is
recommended that agreements be made in writing.

–Freelancers with business names also seek advice on
matters other than commission agreements, such as on lease agreements for
offices. They also ask about issues related to bidding
competitions, procedures related to the collection of overdue payments and
matters concerning employee recruitment.

Insurance
premiums and pension contributions must be accurate and appropriate

Tuire Torvela emphasises matters related to social
security as common problems for both freelancers who work using a tax card and
those with a business name. Employees are, for example, statutorily
insured against occupational accidents, but freelancers have to insure
themselves, if they just wish to do so.

– The unemployment security of self-employed
entrepreneurs or those with small businesses, in particular, is a key problem in
terms of social security, and it should be brought closer to the level of wage
earners. The impact of the YEL income determined by
entrepreneurs on the overall social security of the entrepreneur is also
problematic, claims Torvela.

The sickness allowance and pensions are based on a YEL
level that an entrepreneur can determine independently. If
the YEL premium seems too large, it is easy to downscale the income amount in
order to lighten the payment load. Such downscaling
will, however, be reflected in the level of all benefits and contributions.

- Otherwise, the problems are more or less
field-oriented in nature. For some fields, the terms and conditions
of the subcontracts of foreign commissioning parties are problematic, and for
others, agreements on copyright may be a problem. Some
struggle with bidding competitions and the related terms and conditions
thereof.

When relinquishing copyright, one should pay special
attention to the extent of the copyrights relinquished, and this extent should
be considered in the compensation paid. Translators
have suggested that more just and fair criteria should be used in bidding
competitions for translation services, rather than putting too much weight on
the price.

– Generally speaking, the disadvantages of freelance
work concern the fluctuation and uncertainty of income, and working alone.

Freelance work also provides a flexible alternative
for those commissioning such work; it enables employers
to purchase work assignments without any commitment to regular salary
payments. In such cases, it is essential that freelancers have multiple
customers
to avoid being dependent on any single commissioning party.

–Freelancers view the positive side of their work as
the freedom connected with self-employment and the opportunity to make use of
their own expertise.

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